May 6, 2007

Cheerleader Faces The Music

Readers suggested a topic on the departing NAR economist. “Let’s talk about DL.” One said, “I know he already has a job but we should write his resume for him.”

Another suggested, “DL - ‘I’ve enjoyed about enough of this as i can stand.’”

“Perhaps he may be having some concerns about being sued for the b.s. that he has been peddling for so long to baffle any brains that have been left standing.”

The Chicago Tribune. “On his way out the door, the housing industry’s self-described ‘cheerleader’ is making one last economic forecast, a sober one at that.”

“‘We’re in a real estate recession,’ said David Lereah, chief economist for the National Association of Realtors, who surprised many this week when he announced he would leave the Chicago-based trade group on May 19. ‘I’m projecting the first [nationwide] price drop since the Great Depression,’ he said. ‘We’re going to have negative home prices in 2007.’”

“‘He promotes housing,’ said Washington economist Dean Baker. ‘Certainly, people who were making decisions to move, they either heard David directly or from someone who heard from David that home prices will never fall, don’t worry, the market will stay strong. So they paid too much for a house.’”

“Lereah, in an interview Wednesday, shrugged off the criticism. ‘I feel confident I did a very good job forecasting and reflected what was happening in the marketplace,’ he said.”

“‘If anybody actually took the time to read my book, rather than just comment on the title, I was insistent in it that…a frenetic boom was unsustainable. I predicted a downturn [would occur] shortly after I wrote it, in 2005,’ he said.”

“Lereah said the market overheated primarily because of lax lending practices and record numbers of speculators who bought houses at inflated prices to flip for profit, though others share the blame. ‘It’s easy to say with 20-20 hindsight,’ he said. ‘We’re all partly guilty. But the lenders and the speculators, they had the most in it. Making zero down payments with no documentation, that’s just irresponsible.’”

“‘But the Realtor, the lender, the title attorney, they all got wrapped up in the frenetic pace of the boom,’ Lereah said.” “He has one more public appearance, at a Realtors’ conference in Washington. He warns that his speech will not be cheery.”

“‘I am going to say, look, guys, we all have to face the music,’ Lereah said. ‘We strayed from [economic] fundamentals, and we’re paying for it. It’s not an all-out bust, not a crash in real estate, but it is a recession. This is going to cleanse the markets and in the long term this is what we have needed.’”

“In characteristic cheerleader style he demurred when asked whether he ever felt pressure from within NAR to skew forecasts in a positive direction. ‘You’ll have to talk to me about that in two or three weeks,’ Lereah said. ‘I work for NAR now.’”




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163 Comments »

Comment by Kevin Road
2007-05-06 08:16:53

I heard a new one yesterday. With the presidential election coming in 2008, market will boom and prices will start to rise again. I asked this nice fella why he believed that? He said it happens during every president election. I think he was alittle confused with rates holding steady during most elections. In 1992, no housing boom, in 1996, no boom. In 2000, no housing boom. Only 2004 was their a boom but it had nothing to do with an election, it was already in place. Foolish thinking!

Comment by cynicalgirl
2007-05-06 08:22:55

Perhaps this person was confused by the stock market, which tends to rise the year prior to a presidential election.

Comment by aladinsane
2007-05-06 09:07:51

Methinks he was just confused.

 
 
Comment by NYCityBoy
2007-05-06 09:12:12

“I asked this nice fella why he believed that? He said it happens during every president election.”

And that d#ckhead’s vote counts just as much as mine? Democracy sucks!

Comment by Yuppie NOVA Renter
2007-05-06 11:29:49

Winston Churchill said, “The best argument against democracy is a five minute conversation with the average voter.”

 
 
Comment by bradthemod
2007-05-06 09:21:28

My buddy bought a small fortune in stocks prior to the 2000 election. The bubble was still semi-existant by then (before things really hit the fan in late 2000 to 2003). Thing is, he is a conservative, dollar-pinching guy with hard-working money origin, not just handed the stuff. He blamed the Gore/Bush vote split as why the market choked. So, elections are not a no-brainer. He made an assumption. I made few too and got burned. Maybe thinking the most unlikely thing to happen is the one you should bet on.

 
Comment by GetStucco
2007-05-06 10:31:17

“With the presidential election coming in 2008, market will boom and prices will start to rise again.”

It has already done that, to the tune of a falling dollar and rising inflation. This is not to say the trend will not continue for a while, just that it is not sustainable.

Comment by GetStucco
2007-05-06 10:32:24

Clarification: I was assuming “market” referred to stock market, as the housing market is clearly in crash mode.

 
 
Comment by Sammy Schadenfreude
2007-05-06 11:40:03

The only “boom” coming will be from the catastrophic implosion of this fool’s delusions.

 
 
Comment by stanleyjohnson
2007-05-06 08:27:42

“It’s easy to say with 20-20 hindsight,” he said. “We’re all partly guilty. But the lenders and the speculators, they had the most in it. Making zero down payments with no documentation, that’s just irresponsible.

What about David Lirah representing NAR be irresponsible when saying prices were expected to go up 16% per year forever and home prices on average never go down. Hello 2007 and 2008……….

Comment by mrktMaven FL
2007-05-06 09:29:03

We’re NOT all partly guilty. Moreover, Are you Missing the Boom encourages real estate speculation.

 
Comment by Tulipsalloveragain
2007-05-06 09:46:32

Thank god for every one David Lereah there is one Ben Jones.

Comment by Sammy Schadenfreude
2007-05-06 15:21:16

Not so sure it’s a 1:1 ratio. David Lereah was the public face of a vast snarky enterprise that booked tremendous short-term profits from aiding and abetting the run-up in the housing bubble. Ben Jones is a free-lance writer that smelled something rotten and started a blog to expose it - and has probably not gotten very rich in the process. There are far more DLs in this society - on the make and on the take - than there are far-sighted and principled individuals like Ben Jones.

 
 
 
Comment by passthebubbly
2007-05-06 08:30:45

It’s hard for me to have a whole lot of contempt for Lereah.

After all, he was just doing his job — which was NOT to give a fair and unbiased assessment of the RE market. His job was to be the mouthpiece for a group of people who sell houses for a living, and to maximize these people’s profits by getting Americans to buy and sell as many houses as possible at the highest possible price.

And you know what? He did a pretty good job.

For someone whose paycheck was signed by a group of house-sellers, what else would you have expected him to do? What would have been a desirable outcome? So he says prices are too high back in 2003, then he gets fired and the NAR puts someone more accommodative in, so now what?

Comment by Key Lime Toast
2007-05-06 08:45:01

I continue to be amazed by those who think that lying and deception is somehow OK and understandable as long as you do it for a living.

Comment by passthebubbly
2007-05-06 08:58:42

It wasn’t deception to anyone who considered the source. And is it possible to “lie” about predicitons?

Don’t get me wrong; I’m no RE bull and don’t particularly like Lereah. But the world has a place for snake-oil salesman, and nobody is ever forced to buy the snake oil. If it weren’t Lereah it would have been someone else.

Comment by aladinsane
2007-05-06 09:10:32

Sounds like an apology worth of goebbels…

A quote from little joe:

“The most brilliant propagandist technique will yield no success unless one fundamental principle is borne in mind constantly - it must confine itself to a few points and repeat them over and over”

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Comment by cmhappyrenter
2007-05-06 12:18:59

didn’t know bonanza was so deep

 
Comment by REhobbyist
2007-05-06 12:35:24

What did Hoss say? :-)

 
Comment by hd74man
2007-05-06 17:16:23

it must confine itself to a few points and repeat them over and over”

Or lie consistantly and constantly and soon the masses will believe what your are telling them is the truth.

 
 
Comment by Key Lime Toast
2007-05-06 09:12:33

He’s the Head Economist of one of the largest and most powerful professional organizations in the country.

I believe his behavior by most standards was knowingly deceptive, misleading, unethical and possibly criminal.

“If it weren’t Lereah it would have been someone else.”
That has got to be one of the lamest excuses ever.

The fact that all of the above is widely condoned, and aided and abetted by the complicit media and “press corp” is truly a sign of the corrupt times we live in.

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Comment by Key Lime Toast
2007-05-06 09:19:42

“sign of the corrupt times we live in.”

should read:
“sign of the morally corrupt times we live in.”

 
Comment by dukes
2007-05-06 09:53:30

I have to agree with Key Lime here, there is never an excuse for the kind of deception that Lereah was involved in…

 
Comment by aladinsane
2007-05-06 10:03:44

Liked you in trading places, dukes.

 
Comment by Recovering Homeowner
2007-05-06 10:09:40

To me, the big difference is in his job title. He was NOT the Chief Marketing Officer. Instead, he was the chief ECONOMIST - ie, his job was to present financial matters and trends truthfully and factually, not to put positive spin on same.

He is no better than the CFO of Enron and/or Worldcom and/or Adelphia and/or Tyco for lying and possibly criminal behavior.

 
Comment by aladinsane
2007-05-06 10:54:22

Another e-CON-omist

read between the lines, lereah…

 
Comment by captain jack sparrow
2007-05-06 11:35:11

It is true though. If DL had went to his bosses and said that he could not publicly lie like this then he would have been fired. Then the Bosses would have sought out someone like leslie Applehead Young or someone else.

Then the bosses would have instructed the replacement to cheerlead and lie. And the replacement would have done it. Bottom line is the bosses wanted someone to do what DL did.

That does not mean what DL did was right. Its just that anyone who ultimately filled his position would have lied and been a cheerleader or they would have been replaced by someone else who would have.

I guess luckily for DL s bosses they only had to pick DL and he did their bidding for them without hesitation.

The Bosses did not get any backtalk from DL. They gave him a job and he carried it out.

Problem is DL will be rewarded in the future by new bosses who see that he marches to the party line, doesnt make trouble like telling the truth, and does as he is told.

In this country truth tellers are not really wanted. Those that lie and go along with the company line are rewarded.

Funny, cause in school they teach you to be a good kid, be honest, tell the truth, etc etc etc, then you go out in the real world and all the stuff we teach our kids doesnt ammount to a hill of beans.

The “good honest truth telling kids grow up to make it from week to week and month to month. The kids who grow up to lie and only care about their paycheck and to lie and follow the company line are the ones who prosper.

Why dont schools just be honest then and teach all the children to lie, cheat and steal, and be false. Then every child could have a chance for success. If you are honest in this country now you have no chance for success.

 
Comment by Tom
2007-05-06 11:45:21

Congress or the SEC needs to make the NAR not have any economists for a while. Punish them for their lies.

 
Comment by CarrieAnn
2007-05-06 12:05:52

“The “good honest truth telling kids grow up to make it from week to week and month to month. The kids who grow up to lie and only care about their paycheck and to lie and follow the company line are the ones who prosper.”

Captain Jack,
I believe the ones that prosper are those that appear to be honest, while defaulting to any level of self interest the situation permits. Ya gotta get that upstanding citizen mask thing down, get the people on your side.

Not sure why you blame the schools. School systems aren’t run anything like businesses, or even government. I think teachers truly believe that’s the way to behave. I’m thinking jr’s just watching mom & dad. It’s the age old concept of other peoples’ poops (sins) stink but not theirs, a concept as old as time.

I don’t like that the country/economy is run by crowd manipulation but judging by the way several of the founding fathers weren’t exceptionally trusting of the masses’ abilities, I’m thinking “handling the crowds” isn’t anything new. We’re just lucking enough in these days to be privy to a lot more info, aren’t we?

 
Comment by AKRon
2007-05-06 12:10:23

“If it weren’t Lereah it would have been someone else.”

Yer honor, if I hadn’t cooked the crystal meth, someone else woulda…

 
Comment by jdd
2007-05-06 12:20:18

I generally agree. Anyone who puts any basis on some generic forecast from an obviously biased, propogandist deserves what they get.

Information and forecasts, if they are good, cost money. People looking for a free lunch will find out that there is no such things.

If buyers were using his propoganda as a way to confirm their pre-existing bias in favor of buying a house, again, they get what they deserved.

A fool and his money are soon parted. If it wasn’t this guy it would have been somebody else. Listening to any of these “economists” is akin to listening to Baghdad Bob for news on the U.S. invasion.

I often wonder how many people get through life with so little innate skepticism. People who can make money by selling things are generally going to use “puffery” to get the best price. If you are too stupid to realize that then hire a trustee to run your life.

 
Comment by AKRon
2007-05-06 12:34:24

The ‘ethical arguments’ on this tread are a new low. Essentially, the argument is “anyone reasonable would know that LR works for NAR, and is thus an lying POS shill. Therefore, he isn’t a lying POS shill. Oh, and he was paid, too. That makes him even more ethical.”

We aren’t arguing about his motivations. We aren’t arguing that people who bought his BS hook line and sinker were being clueless. We are arguing that the man lied for money, damaged lots of people, and probably helped damage the entire economy. He deserves moral opprobium, and this blog is going to give it to him ;)

 
Comment by Sammy Schadenfreude
2007-05-06 15:44:05

We are arguing that the man lied for money, damaged lots of people, and probably helped damage the entire economy.

I don’t see any basis for argument. Those are verifiable facts. DL used his position and title to misinform and mislead credulous people who could be forgiven for thinking that an “economist” is supposed to render non-biased and factual assessments. DL is a scumbag, and his apologists are as morally bankrupt as he is.

 
 
Comment by Jerry F
2007-05-06 12:24:41

Plenty of snake-oil-salesmen around. Any doubt just look at TV ads by the credit card industry, lenders all saying “buying now”. Even the CNBC talk heads said, “as long as the consumer keeps buying the economy will expand” Pres. Bush said the same thing as well as Greenspan and the boys. Yes there are many to blame and common sense was lost by the consumer as reality 101 is taking place.

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Comment by AKRon
2007-05-06 13:06:41

Actually, as bad as DL is/was, I think the shills in various RE programs at universities are even worse. Since they work for public universities (though their programs are usually funded by real estate moguls- it takes some searching to discover who…) they appear to be unbiased researchers. These POS are really in need of a good spanking. For instance, UCLA (Anderson School on Mng, The Richard S. Ziman Center for Real Estate), but there are DOZENS of these pseudo-academic centers, and it does not take long, perusing their website, to find out were there cash comes from…

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Comment by Yuppie NOVA Renter
2007-05-06 11:33:32

He never was paid by you and me to give unbiased analysis. He was paid to -advocate-. It’s like an attorney defending a murderer. Nobody ever calls the attorney a liar when he argues that the killer is innocent. Same situation here. DL was paid to advocate for an industry and that’s exactly what he did.

The only problem, in my opinion, is that so many people have confused him for some sort of objective analyst. He never was and it’s shocking that people thought he would be.

 
Comment by Sammy Schadenfreude
2007-05-06 11:46:35

Agreed, KLT. Deceit and deception have become so all-pervasive that even in here some people don’t seem at all bothered by it, just rationalizing it away. We are truly screwed as a country and society when the majority condone, or at least can’t be bothered to take a stand against, unethical and illegal behavior.

Comment by accroyer
2007-05-06 13:33:07

If DL was ethical he would have resigned the minute he sensed something was wrong . I think he knew all along that the RE was heading for a nose dive, but wanted to milk as long as he could, then plead ignorance.

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Comment by slowburn
2007-05-06 13:57:02

Exactly KLT. Using PTB’s rationale, Hitler was just trying to improve Germany’s economic/political well-being.

 
Comment by marinite
2007-05-06 19:09:26

“I continue to be amazed by those who think that lying and deception is somehow OK”

Anyone who thinks lying and deception are ok if it is what yoiu are being paid to do should read Sissela Bok’s book — “Lying: Moral Choice in Public and Private Life”. It is quite approachable and I guarantee you will look at lying in a different light.

 
 
Comment by snabs
2007-05-06 09:09:55

I understand your point. However, the problem is that he mislead people. “Doing your job” doesn’t justify doing a bad job. Being paid to mislead people doesn’t absolve someone of the responsibility of their actions.

He claims that it was the lenders and speculators who were mostly to blame for the bubble. Well, in an interview about the viability of the Florida market he claimed to be invested in several homes around Florida. Now that’s the pot calling the kettle black.

The problem with DL is not that he was doing his job. The problem is that he accepted a dishonest job. His job was to use his gravitas as an economist to convince people to give their money to DL’s employers regardless of the financial damage his audience might incur.

He now claims that, “I was insistent in [my book] that…a frenetic boom was unsustainable. I predicted a downturn [would occur] shortly after I wrote it, in 2005.” That is deceitful. Although he may have tried to cover himself with that tidbit in his book, subsequent comment negate its substance. After publishing his book, he claimed over and over that RE never goes down.

If he truly believed his book, then he is a liar. If he changed his mind, then he should have pulled the book. Mr. Liareah painted himself into a corner. A few comments at the end of his tenure cannot undo the billions in bad decisions based on his advice.

He seems to suggest that the NAR pressured him into to giving rosy predictions. If he did something he believed to be unethical in order to keep his paycheck, then he’s a prostitute.

Anyway you look at this man’s actions, he is inextricably tied to the profit mongering of this RE market. He will be remembered as the poster boy for the greed and deceit of America’s most recent housing nightmare.

Comment by mrktMaven FL
2007-05-06 09:35:41

Well fri+-in said…. Applaudingly well said.

 
Comment by 45north
2007-05-06 10:01:25

snabs: The problem is that he accepted a dishonest job.

I’m afraid your right snabs, At first it was pretty good: great salary, expense account and real estate was taking off! Then one day, he sat at his desk and he realized that the market was going to go down but he also knew the message that he had to deliver. As time went on the the conflict grew. Anyway he quit. Wonder what he said privately to his boss?

Comment by snabs
2007-05-06 12:21:06

That makes sense.

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Comment by athena
2007-05-06 12:16:43

the realtor is the middleman between the lender and the speculator. They are the pimps of this bubble.

They are the ones with their “preferred” lenders, and in charge of the purchase transaction.

They are the ones who did everything in their power to imply they had credibility when discussing the real estate market, and the integrity of the lender they “preferred” to use.

Purveyors of the bubble = realtwhores

 
 
Comment by NYCityBoy
2007-05-06 09:13:39

“After all, he was just doing his job”

Welcome to Nuremberg. Enjoy your stay!

Comment by John M
2007-05-06 09:48:44

he’s not the only one :-(

 
 
Comment by bulwark
2007-05-06 10:30:07

Yes, just like Eichmann was just doing his job. It’s the job’s fault. Lereah did nothing wrong by suckering folks into wasting their life savings on real estate, going bankrupt, getting evicted. He was just doing his job.

 
Comment by Dan
2007-05-06 10:34:03

Heinrich Himmler was just doing his job. What you do for a living is ultimately a choice and as such you are responsible for unethical decisions in your job. In the very lease, DL should give 100% of the money he made in the last 7 years to a trust fund to help the homeless.

 
Comment by Spykeeboi
2007-05-06 10:55:46

Those employed in professional occupations, as is Lereah, must continually balance the interests of those they serve–which, given the tremendous influence and impact of his position as chief economist of the NATIONAL Association of Realtors, is for Lereah the aggregate of American homeowners–and their personal advancement. This is known as ethics.

Lereah was an ethical failure. His market analysis and predictions were biased and without objectivity. He let the NAR down by failing to provide guidance that would foster market growth at sustainable levels. He let homebuyers and homeowners down by fueling instability in the real estate market with historically-baseless predictions . He has greatly contributed to the economic insecurity of all of Americans by promoting investment strategies that leave us on the precipice of a nationwide housing–and possibly multi-sector–recession.

David Lereah is a well-educated man and I am sure his own conscience must–at some level–be furiously gnawing at him. But he must also be subject to the punishments of public condemnation, professional banishment, and possibly legal judgment.

The American marketplace and national economic health relies on the diligence of the professional class. David Lereah should be held to the highest standards of conduct and subject to the most severe discipline.

 
Comment by REhobbyist
2007-05-06 12:33:53

I don’t know, passthebubbly, because everyone gets money from someone. It’s inexcusable when politicians lie for lobbyists, media lie for commercial sponsors, doctors lie for HMOs, lawyers lie for crooked clients, etc. Lereah is represented as an economist, but he is really a spokesman. Maybe the solution is that every professional should tell the truth or say nothing at all, unless they’re a spokesman or press secretary, in which case everyone expects them to lie.

 
Comment by marinite
2007-05-06 19:05:35

“After all, he was just doing his job”

So were the Nazis

 
Comment by Blue Skye
2007-05-08 13:28:53

Having sacrificed more than one “career opportunity” in life on ethics issues, I have no sympathy for him if he sold his good name.

It is something not easily bought back.

 
 
Comment by Perplexed
2007-05-06 08:31:33

So basically the last statement invalidates the “forecasts” he made in the rest of the article . Great work as always, DL.

 
Comment by flatffplan
2007-05-06 08:32:35

DL still lieing to the very end
his book in 05 said NOT to buy cuase it was going to tank
now “it’s local” w 99% of localities tanking

 
Comment by GetStucco
2007-05-06 08:33:42

Is DL legally culpable for trading stellar academic credentials (PhD in Econ from Virginia) into the pied-piper roll he played, first to convince everyone to buy stocks just before the tech stock bust, then to invest in houses just before the housing bust?

 
Comment by SoBay
2007-05-06 08:34:03

California is going to ‘Face the Music.’

1- Illegal aliens … I think that ‘illegal’ means that it is against the law
2- Forclosures … Allowing unqualified buyers violate the laws of Debt to Income.

Todays LA Times has two wonderful articles concerning local forclosures,

Comment by GetStucco
2007-05-06 08:39:02

“1- Illegal aliens … I think that ‘illegal’ means that it is against the law”

It means that it is legal for large banks to loan them money to purchase a home, but illegal for them to work to earn the money used to pay the mortgage.

Comment by sm_landlord
2007-05-06 09:07:22

You need to brush up on your doublethink, comrade. Statements like that verge on thoughtcrime. You could end up taking an involuntary vacation at the Ministry of Love.

Comment by snabs
2007-05-06 09:14:03

LOL

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Comment by Crapburner
2007-05-06 10:00:39

Don’t worry…the Ministry of Truth (media, NAR, talking heads) and the Ministry of Plenty will get the big dollops of created out of the air cash for the bankers to be bailed.

F.B.’s need not apply….1 in 11 ARM resets in the next 9-24 months….yummy.

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2007-05-06 08:35:55

DL’s new job with Move.com- does anyone sense the irony that he will now profit from people who have to move out of their foreclosed houses?

 
Comment by aladinsane
2007-05-06 08:36:24

Bobby Z in the a.m.

Lie lereah lie, lie about everything you said

Lie lereah lie, lie about everything you said

Whatever delusions you have in your mind

We’ll expose them to the light and make that urine shine

Lie lereah lie, lie about everything you said

Stay lereah stay? stay with the r.e. market awhile

Until the break in pay, let me see you make a pile

His hand are dirty, but his clothes are clean

And you’ve told the biggest fibs i’ve ever seen

Lie lereah lie, stay around for awhile

Why wait any longer for the world to begin to understand

You can have your cake and eat it too

Why wait any longer for the ones to get the shove

When a fb is standing right in front of you?

Lie lereah lie, lie about everything you said

Stay lereah stay, stay until you’ve lost all cred

I long to see you in the all bar motel

I long for you to be violated in the night

Stay lereah stay, until the fright of what’s coming is clearly ahead…

Comment by dukes
2007-05-06 10:08:02

why do you post this crap?

Comment by Ol'Bubba
2007-05-06 11:28:30

I have to agree with dukes on this one, Aladinsane. If you did these things in a public setting you’d be booed off the stage.

 
Comment by mjh
2007-05-06 11:51:08

i need a firefox extension that closes all his threads. Hmm, not doing much later…

Comment by REhobbyist
2007-05-06 12:46:20

I used to find him annoying, but he is kind of growing on me.:-)

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Comment by mgnyc
2007-05-06 08:39:45

hey everyone wish me luck i am selling my coop in rego park queens
for my in-laws. i have 2 prospective buyers coming today. both foreigners with accents and hopefully cash. i do not own it but i will
be getting a nice chunk of change from the deal to add to my warchest.
the place is clean and convenient and priced 10% below the local competiton so we will see. it has been paid off since the 80’s
no helocs in this house!! we are moving to a larger space
which we will be renting and be very happy in.
i just throw my money away on rent for the next 12-24 months for sure. stupid me i guess

Comment by mgnyc
2007-05-06 08:42:50

ben sorry for the off topic post. and dl can kiss my a**
that slimy creep.

Comment by death_spiral
2007-05-06 08:51:49

DL is just another lying sack of american sh1t that has become so commonplace these days. when the bust comes(and it is coming soon) it will clean out soooo much bullsh1t. bring it on, baby! I love the smell of dead azzholes in the morning.

 
 
Comment by REhobbyist
2007-05-06 12:49:20

Good luck mgnyc. Lopping 10% off should help your cause. And if you need more space, renting is the way to go for the next few years until prices drop a lot more.

 
 
Comment by neuromance
2007-05-06 08:47:35

Lereah (pronounced ‘Luray’) is the spokesperson for a sales organization. Anyone who expected honest information from him is sadly misinformed. Salespeople are there to move product, not be social workers. Of course, Lereah and those like him work hard to present the image of a unbiased observer. And many, many people do get fooled though. All the time. Take it as a hard lesson. People need to wisen up to the nature of the marketplace.

The bottom line is, people need to understand the motivations of the salesperson they are dealing with. The basic question to ask is, “How does this person get paid?” Realtors get paid from the sale price of the house. And the higher the sale price, the more they get paid. That is the core motivation in their job. Their actions and statements can be easily understood from realizing that core motivation.

Comment by passthebubbly
2007-05-06 09:03:56

This is what I was trying to get to a few posts above. Does it surprise anyone when a car salesman says you need a new car? Or when Citigroup says we need to privatize social security and AARP says we don’t? So what is unexpected about a spokesmodel for the National Association of Realtors saying RE always always always goes up and you need to buy now and when you’re done buying you should sell and buy something nicer?

Comment by GotRocks
2007-05-06 09:13:51

On that topic, the real problem was that he had no counterweight for the past year or so. No representative of the buyers (who could not afford it) and the sellers (who could not find buyers). The only voice you heard was his. Yet there were counterweights. Of course Ben, but also Shiller and other well-known economists. Who’s to blame? The MSM gets my vote - although DL should be thrown in jail just to make a point about following orders from his employer (a defense that did not work too well for many Nazis after WW2).

Comment by passthebubbly
2007-05-06 09:24:14

On that topic, the real problem was that he had no counterweight for the past year or so.

I agree. There is very little concern for balance in mainstream financial reporting. Everyone from the WSJ to CNBC to AOL/CNN/Time Warner is a permabull. The closest anyone comes to being balanced is The Economist, and even they ain’t perfect.

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Comment by NYCityBoy
2007-05-06 09:22:59

Bubbly, start a brewery. Tell the world that your new brew will “cure glaucoma”. You will see how fast salespeople get held accountable. The real issue here is that this is an organization that is not being held accountable in the least.

They should have no right to comment on the value of properties or the potential for future gains. No other “investment” can be marketed that way. The fact that they have been allowed to lie with such abandon shows a systemic problem. It doesn’t take a Sarbanes-Oxley to deal with this issue. It just takes one simple law that says, “Shut the f-ck up” and a governing body with the balls to enforce it.

Comment by passthebubbly
2007-05-06 09:28:24

But now you’re criticizing the NAR, not Lereah. And I largely agree with your criticism of the NAR.

I do wonder whether some sort of government oversight is the necessary answer, or at least government accountability, as we have with most other professions.

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Comment by NYCityBoy
2007-05-06 09:40:23

“But now you’re criticizing the NAR”

And all of the lackeys willing to sell their souls for a buck within their ranks. Lereah was a general in that army.

 
Comment by Dan
2007-05-06 10:42:35

Lereah was a general in that army.

So now he is going to have a Don’t Ask, Don’t Tell policy on the future of housing.

 
 
Comment by Rob-In-Sunnyvale
2007-05-06 10:37:27

Comment by NYCityBoy:
Bubbly, start a brewery. Tell the world that your new brew will “cure glaucoma”.

Reply from typical home-debtor over the last few years: Wow, where can I buy some of THAT beer?

rob

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Comment by REhobbyist
2007-05-06 12:57:28

That’s a good point, NYCityBoy. Sometimes regulation helps. I remember how 15 years ago hearing aid companies used to advertise that their products helped people hear better in noise. The FDA told them to stop making false claims, period. Within a few years the hearing aid companies started actually working on things like directional microphones and digital technology that studies showed did improve hearing in noise. And everybody won.

If the real estate business was similarly regulated, maybe we wouldn’t have such extreme boom and bust cycles that hurt so many people, and everyone would benefit.

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Comment by snabs
2007-05-06 09:21:52

What you two people seem to not understand is this: The problem we have with DL is that he is a liar. We don’t care if GFs listened to him or not. He is putting out a sales pitch masked as unbiased economic forecasts. That is deceitful and should be denounced.

Making the analogy that he is nothing more than a used car salesman in no way mitigates his position. He lies, and profits from his lies. I don’t know if you’ve noticed, but used car salesmen have a bad reputation.

Comment by NYCityBoy
2007-05-06 09:24:41

The first 6 shots of Jack are on me if you are ever in NYC, snabs.

Comment by snabs
2007-05-06 09:26:34

You’re on.

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Comment by passthebubbly
2007-05-06 09:40:38

I don’t know if you’ve noticed, but used car salesmen have a bad reputation.

I never give car salesmen any credibility to start with. In order to lose honor, you first have to have honor to lose. And I never ascribed any honor to Lereah. I guess others here thought differently.

Comment by NYCityBoy
2007-05-06 10:16:04

I don’t think anybody expected more out of him the way you imply. But I think you are in a very bare minority that says, “oh well, that’s what we should expect from salespeople”. And used car salesman don’t have a nationwide organization that helped boost the price of used cars through the stratosphere by promoting widespread fraud and making proclamations of never ending equity gains in the products they were buying.

There is a huge difference between used car salesman and used house salesmen and the markets they represent.

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Comment by passthebubbly
2007-05-06 15:49:17

If I’m in the bare minority here, so be it. I’ve never been one to accept a mindset because everyone else does.

I just think Lereah is more a symptom of larger institutional malfeasance than a cause of it. I have *huge* problems with the NAR as a whole. And the NAR isn’t going to be any more ethical or honorable an organization now that Lereah isn’t part of it. not one bit.

 
 
 
Comment by GetStucco
2007-05-06 10:39:40

“I don’t know if you’ve noticed, but used car salesmen have a bad reputation.”

I don’t know if you’ve noticed, but used car salesmen don’t typically have PhDs in Econ from top programs.

Comment by CarrieAnn
2007-05-06 12:12:56

“I don’t know if you’ve noticed, but used car salesmen don’t typically have PhDs in Econ from top programs.”

So he’s a higher paid version of a used car salesman. Education doesn’t take the liar/cheat gene out of a man.

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Comment by snabs
2007-05-06 12:13:56

GetStucco, I think we’re both making the same point.

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Comment by Wickedheart
2007-05-06 12:16:44

” I don’t know if you’ve noticed, but used car salesmen have a bad reputation.”

Realtor = used house salesperson

 
 
Comment by bulwark
2007-05-06 10:43:20

The MSM and NAR formed a corrupt alliance based on advertising dollars. True, the NAR is a sales organization. In fact, even though their Chief Economist forecasts falling prices, they’re still saying it’s a “good time to buy”!!!http://www.realtor.org/pac.nsf/pages/buynow There’s no excuse for the MSM’s reliance on NAR’s “Chief Economist’s” forecasts as Gospel truth. Nor is there any excuse for NAR’s holding out Lereah as an objective economist rather than a marketing shill masquerading as an economic expert.

Comment by tg
2007-05-06 12:25:13

Will nominal prices of a house bought today be higher in ten years from now?

 
 
 
Comment by Sammy Schadenfreude
2007-05-06 08:49:14

Another ship (DL) sails from the sinking rat, the NAR. The only question I have is: Did he jump, or was he pushed? Rank-and-file NAR members must have long since realized he’d become a liability and a bad joke. It’s not like NARsters have suddenly developed a belated sense of professional ethics or integrity: it’s merely that they’re willing to bilge DL since his credibility is completely shot. His replacement will be an attempt to restore some of the NAR’s shattered reputation by conceding what everyone now knows is obvious: “Housing is in a recession.” While the snake can shed it’s skin, however, it’ll still be a snake, and will tout the usual reassurances that “the damage is largely contained” and “now is a great time to buy, before the market turns around.”

Comment by NYCityBoy
2007-05-06 09:27:07

I predict that this is just an attempt to relist the same POS and reset the “days on the market” back to zero. They are just taking a page out of their own corrupt book.

 
Comment by eastcoaster
2007-05-06 09:32:36

My hunch is he was pushed.

 
Comment by mrktMaven FL
2007-05-06 09:57:19

DL was pushed b/c sales transactions fell of a cliff. His rosy predictions were not helping NAR members on the front lines trying to get sellers to lower prices. Instead, most of his communications supported unrealistic seller pricing expectations and undermined NAR member sales and marketing efforts.

Moreover, the 40 million dollar ‘time to buy OR sell’ ad campaign was a desperate gasping failure. The MSM turned on the NAR’s leadership after it’s launch and so did it’s members. The ad campaign punctuated the end of a corrupt era and DL’s career at the NAR.

Comment by Sammy Schadenfreude
2007-05-06 11:57:14

Good points, all. I’m not yet ready to concede that it’s the “end of a corrupt era.” The vast majority of individuals employed in the RE industry, especially reators themselves, remain deeply, irredeemably corrupt and venal to their cores. They will continue to try to flim-flam would-be buyers. However, we are indisputably witnessing the beginning of the end of extending easy credit to those who are manifestly unfit to receive it. The NAR and its members will continue to be as sleazy as ever, but will have a much tougher time closing deals given the paucity of credit-worthy buyers and growing wariness and disdain toward RE industry “professionals.”

Comment by REhobbyist
2007-05-06 13:04:00

Yes, Sammy, they’re still actively shilling. This weekend’s newspapers were full of real estate lies, though they were forced to make a few admissions about the weakness of the market. Did you see that Sunday NYT had a completely separate real estate section today and Parade magazine was devoted to real estate?

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Comment by Sammy Schadenfreude
2007-05-06 15:55:09

I didn’t read the NYT or Parade, but the Colorado Springs GAZETTE has essentially turned over the real estate section to RE industry “experts” who have a vested interest in keeping the party going - public interest be damned. I wish they were legally required to print a prominent disclaimer that the views presented are solely those of the NAR and its local minions and shills, and should not be taken as objective reporting.

 
 
 
 
 
Comment by mike
2007-05-06 09:00:31

What’s the big deal about David Lereah? Is he a con man? A liar? A cheat? A B.S artist? A hype merchant? No - he’s a SALESMAN (who represents salesmen.) If people listen to salesmen, actually believe them and buy their product without deciding for themselves - that’s their problem. The above applies to politicians as well because they are also salesman. Welcome to America.

Comment by jerry from richardson
2007-05-06 09:30:40

If the lenders and borrowers took all the pain, then I would agree with you. The problem is that taxpayers have to clean up this mess through HUD and the GSE’s

 
Comment by adopt-a-landlord
2007-05-06 10:17:00

There’s nothing wrong with being a salesman, but DL is presented by NAR, the press, and himself as an economist. Unfortunately, society still views economists as impartial forecasters of economic trends. This is what makes DL a fraudulent deceiver, and not a salesman or an economist.

Comment by mrktMaven FL
2007-05-06 10:30:04

Exactly.

 
Comment by snabs
2007-05-06 12:43:56

Well said.

 
Comment by lazarus
2007-05-06 13:31:31

Ditto most Wall Street analysts. The only reason why they require you to have excellent credentials and qualifications is the same reason why Pharisees and high priests wore expensive garments in the time of Christ: Your lies sound more convincing than that of a street hustler.

 
 
Comment by GetStucco
2007-05-06 10:37:02

“No - he’s a SALESMAN”

His academic credentials make him more than a saleman and more culpable for deceptive overconfident forecasts gone bad, IMO.

 
Comment by bulwark
2007-05-06 10:47:41

So it’s OK for salesmen to lie, to hold themselves out as providing objective information, but instead to sucker folks? Is that the way we do business in America?

Comment by Ostriches
2007-05-07 12:37:48

bulwark:

Was kind of thinking along the same lines. First, by deeming DL a “Salesman,” many of you are giving the profession of Salesman a bad name. Second, we all know good salesman from bad- good salesman provide you with pertinent information, are not trying to screw you and you don’t walk away feeling like you just got sodomized. In fact, when you buy something from a good salesperson, you leave happy and are more apt to return. Good salesman think long term, bad do not.

 
 
 
Comment by Lisa
2007-05-06 09:06:01

“Making zero down payments with no documentation, that’s just irresponsible.”

Excuse me? He knows full well this is what’s propped up the market the last few years. If “exotic financing” is now considered irresponsible, then no one can “afford” these prices.

I’m wondering if the the decline picks up steam as 2007 goes on….more foreclosures, more sob stories about being “trapped”, more inventory, big shift in buyer psychology.

Comment by Jon
2007-05-06 19:03:31

“I’m wondering if the the decline picks up steam as 2007 goes on….more foreclosures, more sob stories about being “trapped”, more inventory, big shift in buyer psychology.”

Exactly right; the same forces that were cyclic on the way up will be cyclic on the way down, accelerating the fall.

 
 
Comment by Bill in Phoenix
2007-05-06 09:13:24

DL is but one well known real estate cheerleader. How about Robert Kiyosaki of “Rich Dad, Poor Dad,” who has been pushing the idea of buying houses to rent out? Before it became known that it was a “chinese laundry” story (a severe glut of rentals on the market where people were trying to rent out houses to each other), Kiyosaki had already bought low and sold some of his RE. He was still pushing his book series “Rich Dad Poor Dad” and taking millions of dollars from the gullible people at the bottom of the pyramid in his seminars. Those people are caught holding the bag. Kiyosaki is probably loaded in T-bills (along with his precious metals) and is patiently waiting for 5 years or so when the real estate prices will be 50% off of 2006 prices. He will buy low again.

Moral of the story: if the word on the street is that you can make a lot of money in X, it’s already too late to buy X. The big boys have already cashed out. Same thing on real estate. “Everybody” was into RE in 2005. If you bought in 2003 and you did not sell by January 2005, most likely you are toast.

Comment by NYCityBoy
2007-05-06 09:37:33

I’m not going to say Kiyosaki is great but we need to be fair, even here, if we want to be credible. He is much more realistic than morons like Lereah or Trump or Cramer. In many ways he echoes sentiments of this board. I did a Google and found one of his most recent articles.

http://tinyurl.com/263lm6

Kiyosaki is often very honest. He is obviously no friend of fiat. I read months and months ago when he said to stay away from real estate. All of the amateurs are in and that is time to get out. He is also very harsh on people that live irresponsibly. That makes him more like one of us than Lereah.

And let us not forget that in the not-too-distant past a hardworking, industrious guy could make a lot of money in rental property. It’s not something I want to do but a lot of people have lived very affluent lives doing it. We need to be careful with our statements as much as Lereah should have been or we lose our credibility as well.

Comment by mrincomestream
2007-05-06 10:43:18

Why can’t you make money in rental property now or going forward..?

Comment by NYCityBoy
2007-05-06 11:05:43

Incomestream, who said that? All I pointed out is that you can’t buy now, at bubble prices, and make money as rentals. Pre-bubble and post-bubble you will be able to make money on investment properties.

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Comment by Incredulous
2007-05-06 11:43:30

Kiyosaki is another liar and fake. He’s just conned a different audience.

http://www.johntreed.com/Kiyosaki.html

Comment by snabs
2007-05-06 12:52:37

I’m not a fan of Kiyosaki, but this review by Reed is quite horrible. The man can’t tell the difference between a fact and an opinion. He uses his assumptions to validate his conclusions.

H-O-W-E-V-E-R………..

Kiyosaki is unethical in my opinion. After a PBS special, I attended one of his workshops (assuming that he being on PBS made him legitimate). Well, this seminar was nothing more than a short presentation after which the audience was shuffled off to separate, concurrent lectures on various forms of investment.

These lectures were sales pitches. I paid $150 bucks to hear sales pitches. I was not happy, but couldn’t get my money back. I took this as a lesson learned. Buyer beware.

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Comment by Wino Bear
2007-05-06 14:13:13

Kiyosaki is a clown. I’m not saying that everything he says isn’t true or stupid. It’s not particularly hard to write basic inspirational personal finance advice books these days. But the sanctimonious style of his writing combined with his featherweight analysis and annoying cherry picking of timelines to make him seem smart, lack of documented success except for selling books, and just plain making stuff (the rich dad, poor dad) up for narrative reasons makes me want to barf. John Reed’s site might not be 100% accurate, but there have been plenty of folks who have tried to verify Kiyosaki’s claims of wealth and success outside of selling books and most of them come up empty.

Kiyosaki is my equivalent of Family Circus in the personal finance arena. I hate the the Family Circus, and yet, I still find myself reading it in the cartoons. And then I get worked up about it, and then I get annoyed at the stupidity of it all.

NOT LIKE TRUMP?
10/27/06 - Learning from the Best
Donald Trump is the subject and all the wonderful things that Kiyosaki learned from The Donald while writing their book.

“The timing is ironic. I believe that when history looks back at the start of the 21st century, Bill Gates, Warren Buffett, and Donald Trump will be seen as the Carnegies of the era.”

Oh yes. There’s a keen mind.

IS HE LIKE US?
9/22/05 - When Good Advice Isn’t
“The camera cuts away to an extremely attractive young woman who smiles into the camera and says, “For 1998 my advice is to work hard, save money, get out of debt, invest for the long term, and diversify.”
[snip...]
“Between 1995 and 2005 the millions of people who followed that advice lost an estimated $7-9 trillion. And much worse than losing $7-9 trillion, the people who followed that advice missed out on what the Economist magazine called the biggest financial boom in history. So not only did those investors lose money from the 2000-2003 stock market crash, they failed to make a lot of money in the financial boom in real estate and commodities. That is the price of bad advice.”

Nothing says keen financial analysis like cherry picking timelines to show the stupidity or brilliance of a financial strategy. And if he looks say 30 years back? How about any 10 year consecutive period randomly chosen to see how these asset classes have fared?

“I’ll explain in detail why the standard financial advice of “work hard, save money, get out of debt, invest for the long term, and diversify” is bad financial advice because it’s obsolete. The world has changed. The advice hasn’t.”

This sounds like he’s one of us? The point of his writings is to move cash into asset classes, particularly hard asset classes rather than keep say cash or say an index fund, but that anybody would write something so stupid as the above quote is DOA. You need to save for the simple reason that if you don’t, the primary way to invest is heavy leverage. Oh that’s right, I forgot…

DEBT
10/27/05 - Putting Debt to Work for You

I like this one because combines two of Kiyosaki’s favorite pastimes: narcissism and atypical results.

This “I’m such a great investor” spiel shows that how going with 100% financing (90% borrowed, 10% on his credit card), with no liquid assets to speak of, panned out very well for him. There is a 1 phrase disclaimer that he doesn’t recommend this for others, and yet, 75% of the article talks about how he and his wife made out big leveraging themselves up to their eyeballs. It’s like watching those diet commercials where the tiny print says that results aren’t typical. If he doesn’t recommend it, why is he spending so much time to talk about it? Maybe to create a Pavlovian response in his readership to sell more books?

And then there are these gems:
“My banker is my best partner,” my rich dad used to say. “He loans me 90 percent of the money and I control 100 percent of the property, 100 percent of the profits, and 100 percent of the tax breaks. All I have to do is find great investments he wants to be a partner in.”

Leverage cuts both ways. If you’re down 10% and forced to sell, you’re wiped out on paper. You need liquidity to sensibly ride this out and deal with the unexpected. I have nothing against leverage per se, but such a flippant attitude towards leverage will cause most people a lot of heartburn.

“Between 1995 and 2005, savers — people who saved money in bank accounts or in mutual funds — were the big losers. They lost because the stock market crashed. Between 1995 and 2005, many of the debtors who took advantage of low interest rates to invest in real estate made fortunes in the biggest real estate boom in the history of the world.”

Again, to the best of my knowledge, the stock market existed before 1995. So did real estate and precious metals. Perhaps it would be good to look at other 10 year periods. But he loves using this example repeatedly because it helps him sell books.

Comment by REhobbyist
2007-05-06 18:02:16

He’s made a lot more money promoting himself with that book than all of his real estate speculating. I read an article in the paper today about a local woman who started a foreclosure web site a few years ago. Now she makes her money by giving seminars to convince other people to buy foreclosures. This is her time in the sun and she’s cleaning up. Salesmen like Kiyosaki and this woman are smart, pitching to the get-rich-quick crowd.

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Comment by rzero
2007-05-06 10:41:51

I saw Kiyosaki on the local PBS station here in Phoenix, selling one of his books during a fund-raising drive. This was a WHILE ago, possibly over two years ago. He said something to the effect of, “Is there a real estate bubble? I don’t know, but I hope there is, because when a bubble bursts it creates great buying opportunities, and I will be buying like crazy if it happens.”

In early ‘05, it was hard to find ECONOMISTS talking possible bubble, let alone real-estate gurus. Now I haven’t read any of Kiyosaki’s books, but that comment made him stand out above many other real-estate types, many who STILL won’t use the word “bubble”.

 
Comment by arroyogrande
2007-05-06 11:19:51

“Kiyosaki had already bought low and sold some of his RE.”

Not to defend him to heavily, but he DID have a serries of articles on Yahoo finance explaining that he thought that there may be a bubble, and that he was trimming his RE portfolio and investing in mteals and oil. This was about a year ago or so.

Also, the most of the people that reak RK’s books get the wrong message. They read them and think the message is “quit your job, working is for idiots, you’ll make a killing on any kind of real estate (no matter what the fandamentals)”. WRONG. The message is don’t buy things you cannot afford, and instead of buying playthings, buy things that give you positive cash flow. Not RE that may give you positive cash flow 10 years from now, but RE, investments, etc. that give you real positive cashflow NOW. The End.

Comment by Incredulous
2007-05-06 11:45:01

He’d be more credible if he’d actually made any money in real estate, instead of just claiming he had.
http://www.johntreed.com/Kiyosaki.html

Comment by Tom
2007-05-06 11:50:50

Im not sure how credible John Reed is either.

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Comment by Wino Bear
2007-05-06 18:20:02

Amusingly, if you do a search for “Robert Kiyosaki” on Google, Reed’s site is the second link, even ahead of richdadpoordad.com. It’s not like his wikipedia entry is all that flattering either.

Reed’s site isn’t just one person’s opinion on RK. Similar to this blog, he provides plenty of links to others who have tried to pin RK down on those annoying things like facts and reality and who have come up empty.

 
 
 
 
Comment by Melissa
2007-05-06 11:44:42

“Moral of the story: if the word on the street is that you can make a lot of money in X, it’s already too late to buy X.”

If you read carefully in his book “Rich Dad, Poor Dad”, he says this same thing. Although I think some of the things Kiyosaki says are good to consider, overall, I kind of think he is a capitalistic pig. What did it for me, was an article I read on Yahoo where he was describing what Cortez and his men did. In it he said, “I’m not condoning murder and theft, but at least they [Cortez and his men] knew how to help themselves.” That’s a little too politically incorrect for me …

Comment by snabs
2007-05-06 13:02:50

I try to not give too much importance to silly side comments unrelated to the main topic…. but using Hernan Cortez as an example of anything to emulate? Good god, man!

 
Comment by JCM
2007-05-06 16:39:47

“I’m not condoning murder and theft, but at least they [Cortez and his men] knew how to help themselves.” That’s a little too politically incorrect for me …

It’s true is it not? They did know how to help themselves.
!@#$ political correctness!

 
Comment by Louie Louie
2007-05-06 21:44:24

Show me his IRS tax return than we will talk if he is rich or how much is from RE vs books.

 
 
 
Comment by Renterfornow
Comment by adopt-a-landlord
2007-05-06 10:30:50

Great find rentfornow!

Comment by REhobbyist
2007-05-06 13:17:50

All right, who on this blog produced that video?

 
 
 
Comment by eastcoaster
2007-05-06 09:19:46

“In characteristic cheerleader style he demurred when asked whether he ever felt pressure from within NAR to skew forecasts in a positive direction. ‘You’ll have to talk to me about that in two or three weeks,’ Lereah said. ‘I work for NAR now.’”

Think he’ll dish once he’s officially off the payroll?…

Comment by NYCityBoy
2007-05-06 09:42:02

He’s growing some integrity in a petri dish at home. He’s expecting it to be ready in 2 - 3 weeks.

Comment by snabs
2007-05-06 13:04:58

I think he’s growing it in one of them Chia-integrity pots.

 
 
Comment by slowburn
2007-05-06 14:47:53

This is interesting. DL is in the ultimate win/win situation. He can either write a best seller about the criminal actions of the NAR or extort a nice severence/payoff from the NAR before he walks into the sunset.

 
 
Comment by eastcoaster
2007-05-06 09:22:53

He has one more public appearance, at a Realtors’ conference in Washington. He warns that his speech will not be cheery.

“I am going to say, look, guys, we all have to face the music,” Lereah said. “We strayed from [economic] fundamentals, and we’re paying for it. It’s not an all-out bust, not a crash in real estate, but it is a recession. This is going to cleanse the markets and in the long term this is what we have needed.”

Translation: My new job involves actually selling houses (sort of) so all the gobbly-gook I said over the past several years is now being retracted and we need a major correction so the homes my new company is listing/trying to sell will sell.

 
Comment by KIA
2007-05-06 09:29:35

*Did* anyone actually read his book? He sounded sour somehow, like it didn’t sell very well. I’m just curious whether he’s lying about what the book said.

Comment by NYCityBoy
2007-05-06 10:20:10

It was the Mein Kampf of real estate. A lot of people talk about it but very few have read the entire thing.

The funny thing is Hitler originally wanted to call Mein Kampf “Four and a Half Years of Struggle against Lies, Stupidity, and Cowardice.” Somehow I think Ben Jones will eventually be able to author a book by that title.

 
 
Comment by Cow_tipping
2007-05-06 09:36:33

This is the begining of the end.
A reservoir is emptied by a plug. DL is the plug, NAR is the walls of the reservoir and the water … well that’s the prices the homeowners are under.
Cool.
Cow_tipping.

 
Comment by Somewhereovertherainbow
2007-05-06 09:39:05

Holy shit! I didn’t see this coming. I knew the rats would be jumping ship, but I didn’t expect them to be fanning the flames.

 
Comment by Cow_tipping
2007-05-06 09:40:38

Remember, volume counts more than actual price for the NAR, cos they want sales and hence commission. They can then live on burgers instead of steak. They will throw the sellers under the bus for prices if it means making sales numbers. They want a sharp drop in prices if it means a sharp rise in sales numbers. Like a stock market (like a brokerage house or the exchange itself) they want trades, not up or down - that dont even matter.
Cool.
Cow_tipping.

Comment by snabs
2007-05-06 13:07:50

So it would make sense that the NAR needs a new face for its new sales strategy.

 
Comment by lazarus
2007-05-06 13:42:22

Reminds me of a stockbroker joke I recently heard that goes like this:

What is the best birthday present for a stockbroker?

50 daytraders!

 
 
Comment by sm_landlord
2007-05-06 09:52:35

Speaking of Facing the Music…

 
Comment by Home_a_Loan
2007-05-06 09:58:52

Ahh yes let’s not judge a book by its cover! That’s not FAIR! The cover of his 2005 book reads:

“Are You Missing the REAL ESTATE BOOM? Why Home Values and Other Real Estate Investments Will Climb Through the End of the Decade - and How to Profit From Them”

No, let’s not judge by the cover, let’s judge by the text in the flap of the book:


Are you missing the real estate boom? Can you increase your wealth from it? For most people - including current homeowners - the answer is a resounding yes.
But it’s not too late to increase your stake in the greatest real estate boom of our generation. Whether you are a first-time buyer or already own your home, Are You Missing the Real Estate Boom? will show you how you can dramatically increase your overall wealth. Author David Lereah, chief economist for the National Association of Realtors(R), shows why the real estate market is poised to climb higher over the next decade - and explains what you can do to profit from it.
Lereah calls today’s market a “once-in-every-other generation opportunity.” Today’s boom is not just driven by low interest rates - there are a host of demographic and economic reasons why real estate will continue to out-pace other investments, from the growing needs of the baby-boomer generation and the rise of the “echo” boomer generation to the new ways real estate is marketed and sold.
Are you a first-time buyer? A current homeowner considering whether or not to trake up? There has never been a better time to do so, Lereah convincingly claims. In Are You Missing the Real Estate Boom?, Lereah explains what to look for when you’re buying a home; which improvements add the most value to your current home; what to consider when purchasing rental properties; how to evaluate real estate investment trusts (or REITs); and the pros and cons of second homes. Full of detailed information on how to work with a real estate agent and a mortgage lender, how to analyze local markets and regional fluctuations, and how to best finance your investment, Are You Missing the Real Estate Boom? offers readers the seasoned advice they need to invest with confidence and reap outsized rewards.
[Then a bio on our beloved David Lereah.]

(emphasis added)

I think the words of this lying POS speak for themselves.

Comment by Home_a_Loan
2007-05-06 10:12:13

OK here’s the bio, for the record:


DAVID LEREAH, senior vice president and chief economist of the National Association of Realtors(R), serves as the association’s spokesman on the economy and real estate markets. Dr. Lereah is one of the nation’s most prominent housing economists. He has written numerous books and articles on finance, investments, and real estate; is often quoted in the Wall Street Journal, the New York Times, and BusinessWeek; and appears frequently as a commentator on CNN and CNBC. He lives with his wife, Wendy, and three children in Fairfax Station, Virginia.

BTW all this is quoted from Amazon’s “Online Reader”, which has selected pages of a book for preview. Amazon still has this book for sale for $15.56 though it looks like you can get a used copy for $0.98. (What a waste of 98 cents!)

 
 
Comment by mrktMaven FL
2007-05-06 10:12:27

All in all, I’m going to miss the turd polishing SOB. DL gave me a lot of material for comments on this blog. What’s more, he provided ample opportunities to use my research, critical thinking, logic, statistical, sales, and marketing skills. If you’re reading this thread DL, Cheers! Also, don’t drop the soap :)

 
Comment by Frank
2007-05-06 10:22:13

DL should be lacked in the cell as Allan Greenspan so they can discuss the effect of a housing bubble on an average hard working American family for the next 20 years.

 
Comment by guess who's
2007-05-06 10:23:18

Seems Lie-RAH has a new book out. Check out the title:

All Real Estate Is Local: What You Need to Know to Profit in Real Estate - in a Buyer’s and a Seller’s Market by David Lereah (Hardcover - April 3, 2007)

Comment by GetStucco
2007-05-06 18:12:21

SD prices are over the top of the biggest hill on the roller coaster and appear to be headed down the other side

http://macromarkets.com/csi_housing/MSA/san_diego.asp

as do LA MSA prices

http://macromarkets.com/csi_housing/MSA/los_angeles.asp

as do San Francisco MSA prices

http://macromarkets.com/csi_housing/MSA/san_francisco.asp

as do Tampa MSA prices

http://macromarkets.com/csi_housing/MSA/tampa.asp

as do New York City MSA prices

http://macromarkets.com/csi_housing/MSA/new_york.asp

as do Boston MSA prices

http://macromarkets.com/csi_housing/MSA/boston.asp

as do Cleveland MSA prices

http://macromarkets.com/csi_housing/MSA/cleveland.asp

as do Detroit MSA prices

http://macromarkets.com/csi_housing/MSA/detroit.asp

as do Minneapolis MSA prices

http://macromarkets.com/csi_housing/MSA/minneapolis.asp

as do Las Vegas MSA prices

http://macromarkets.com/csi_housing/MSA/las_vegas.asp .

Given that “all real estate is local,” the highly-correlated price movements in local housing markets across the U.S.A. are very striking.

 
 
Comment by Dan
2007-05-06 10:27:24

David Lereah, chief economist for the National Association of Realtors, who surprised many this week when he announced he would leave the Chicago-based trade group on May 19.

If David Liar is jumping ship, it’s official: Elvis has left the building. What a scumbag this guy is. After he ruined the financial lives of millions of people he’s saying, “screw you guys, I’m going home”. This guy should never be allowed to have an income again.

It’s easy to say with 20-20 hindsight,’ he said. ‘We’re all partly guilty.

Everyone on this blog said that speculators and lax lending where driving a bubble that will burst horribly BEFORE it happened. Foresight can be 20-20 too if you aren’t blinded by greed or telling a pack of lies.

Oh, and no one here is even “partly guilty” Mr. Poster Boy for unethical Realtors. God, I hate this guy. People like him make we wish I believed in a hell so that I could imagine him there.

“In characteristic cheerleader style he demurred when asked whether he ever felt pressure from within NAR to skew forecasts in a positive direction. ‘You’ll have to talk to me about that in two or three weeks,’ Lereah said. ‘I work for NAR now.’”

Just admit that you are a bigger whore than Paris Hilton. Then grovel for forgiveness from all those you screwed. Yeah, I know a lot of them deserved to be screwed, but that doesn’t make it right. Damn, I hate this guy. He makes pond scum waterfront microlife look like an evolved being.

 
Comment by mrktMaven FL
2007-05-06 10:38:48

Judging from the remarks in the Chicago Tribune article, DL’s next book will probably be titled: Confessions of a Corrupt and Discredited Realtor/Economist–How I profitted from destroying the American Dream and millions of hard working families.

 
Comment by mrktMaven FL
2007-05-06 10:43:57

Cheerleader faces the music.

Cheerleader loses his chair/cheer after the music stopped.

 
Comment by Sammy Schadenfreude
2007-05-06 12:02:29

http://www.welovetheiraqiinformationminister.com/

Birds of a feather flock together - maybe DL and “Comical Ali”, the former Iraqi Information Minister, can launch a joint venture together.

Comment by snabs
2007-05-06 13:10:36

DL and Comical Ali….. I love this blog!

 
 
Comment by xstate
2007-05-06 13:12:37

It doesn’t surprise me that DL ran out. I’ve watched him for over two years going on about how McMansions were a good buy and that real estate always goes up and so on. I don’t feel sorry for anyone who followed him, it’s obvious that he’s a shyster. Just as the housing market started going to h$ll, he went on about how real estate is local and how we’re in a flat market and etc…given the intelligence of most of his followers they jumped right in even though everyone else knew the housing economy was belly up.

The more things change, the more they stay the same.

 
Comment by Somewhereovertherainbow
2007-05-06 14:40:14

He’s a lying sack-o-sh_t, but I blame the press more than him… for spouting all his sh_t. Would you ask a used car salesman if it’s a good time to buy a car? The mainstream media sure did and spouted his (and other real estaters) crap for years.

Anyway, there’s an oversupply of Realtors (TM) now. Hope the internet puts a serious squeeze on their 6% crookery.

 
Comment by HarryD
2007-05-06 17:22:43

He was hired by a group of liars - to lie. Not much surprise here at all

 
Comment by Somewhereovertherainbow
2007-05-06 17:27:24

MAKE MONEY NOW! Earn up to $17,000 per week working from home. No experience necessary. http://www.realtor.org/

 
Comment by Eisbär
2007-05-06 19:16:00

One down, so many more to go …

When will it be Kiyosaki’s turn? Will The Donald go bankrupt yet again?!?

 
Comment by sohonyc
2007-05-06 20:37:15

“I work for the NAR now”

Well… if he *does* come clean, brace yourself for one of the biggest class action lawsuits since big tobacco.

 
Comment by OB_Tom
2007-05-07 10:27:36

If DL is predicting prices will drop, does that mean they will go up?

 
Comment by bayparkwatcher
2007-05-07 14:30:26

What no one has mentioned so far is that DL’s new job is at Move, Inc., which operates NAR’s official website, realtor.com. He’s still in the game!

 
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